Journalism Online: time to start paying for online news

Is the end of ad-supported "free" online news upon us? A new venture called …

The Internet is quickly destroying the need for newspapers to run printing presses, distribute papers around the city, and employ newspaper carriers, but the cost savings have come with revenue losses, too: most newspapers offer their online content without subscription fees, supported only by ads. A group of media executives has just announced Journalism Online, a new way for newspapers to start charging for online subscription fees. Will it save journalism?

"We have formed Journalism Online, because we think this is a special moment in time when there is an urgent need for a business model that allows quality journalism to be the beneficiary of the Internet's efficient delivery mechanism rather than its victim," said cofounder Steven Brill. "We believe we have developed a strategy and a set of services that will establish that model by restoring a stream of circulation revenue to supplement advertising revenue, while taking advantage of the savings to be gained from producing and delivering content electronically."

That circulation revenue will come from a new Web portal that handles payments and authentication. Journalism Online wants to sell monthly and yearly subscription packages to sets of magazines or newspapers, which may be an easier sell than convincing readers to pay separately at multiple online news sites. Money would be distributed to the newspapers based on the popularity of their content.

The new company is headed by Brill, the founder of CourtTV and Brill's Content, former Wall Street Journal publisher Gordon Crovitz, and former cable exec Leo Hindery. Discussions with newspapers have only begun, but Brill has previously spelled out what he thinks newspapers like The New York Times need to do in order to stay competitive, and the ideas are worth a closer look.

In a memo earlier this year, Brill argued that sites like the Times could better capitalize on its 20 million online readers by:

Charging 10� to read each article

Charging 40� to read all the articles from that day

Selling a one-month subscription for $7.50

Selling a one-year subscription for $55

Offering print subscribers online access at a 50 percent discount

Charging 5� to forward a full-text article to someone else

Offering a 5 percent affiliate payout to sites like the Huffington Post when they drive paying customers to the Times

The Journalism Online model won't follow this plan identically, differing most obviously in its one-stop subscriptions to multiple news services, but it's clear that Brill has given a lot of thought to transitioning online news service away from ad-only revenue streams. He doesn't paint search engines like Google as the enemy, either. Brill wants to preserve newspapers' search results, so he advocates letting search engines show the headline and first paragraph of every article.

Shifting customers away from the "free" online news model might be difficult, but the idea is to turn a liability into a strength—billing online news as something where "you get what you pay for."

It might sound audacious, but charging more for content has worked well for some offline news outlets. Even in an era of cheap online news, The Economist (for instance) is doing well with $100+ per year subscriptions because it's offers an incredible product that people are willing to pay for. The result? Unlike almost every other magazine in the world, The Economist actually pulls in more revenue from subscriptions than it does from advertising.

Brill et al. want to move online news in this direction, and they argue that it's necessary to support quality journalism. Will people pay? With the Associated Press also making plenty of noise about charging more for content, it's possible that a big chunk on US-generated online news could go behind the pay wall in the next year or so. That will certainly drive readers to quality sites that remain ad-supported (like The Guardian's excellent UK website, which has a huge group of American readers already), but Journalism Online hopes that a substantial proportion will choose to pay up for unlimited access to online news.

"My experience with The Wall Street Journal taught me that people will pay a reasonable price to access exclusive, differentiated and essential journalism, whether delivered in print or online," said Gordon Crovitz, announcing the new venture. "News publishers, including digital-only operations, need to find ways to attract revenues from readers as well as from advertisers."

As long as I can get the news I want online for free this has no chance. As long as the internet is around I can get the news I want online for free. Anyone see the catch 22?

The problem with the internet for content businesses in general is that it takes away the only thing content business has: value. When anyone can create and distribute content, the only reason to pay for the content that costs money is if it is genuinely better than the free content. The advent of the internet has made it so that the free content suffices and the paid content can go to hell.

This is particularly bad for the news industry because news does not require an artistic skill (like acting and music making presumably do) meaning it is much easier to create your own news at home and distribute it. Note that the music industry is succeeding at selling content online and the newspaper industry is having trouble with it.

I want to make it clear I am NOT talking about piracy here, while relevant, it is not part of my argument. Even allowing for a "perfect" world where no one breaks copyright, the internet would still provide free content.

How come TV stations can air local news programs only off advertising revenue but a website which is bound to have lower operating cost can't be profitable without subscriptions? I'd think a popular site like the NY Times could charge more for their ads if the ads aren't pulling in enough revenue. I don't buy that the model of the physical paper should be the model of the online content. The cost of printing and delivering the paper is tremendous, but the cost of hosting the online version is barely noticeable in comparison.

If newspapers are losing money because of the cost of printing, why not get out of the printing business and go strictly online? Sure there are gonna be some consumers that won't read the paper online, but I'm sure some people never learned to drive those newfangled and noisy contraptions called the horseless carriage either. I read a set number of websites every morning when I get up, but I haven't subscribed to the local paper in over 15 years. But I seriously doubt I'm gonna pay to read the sites I visit every day, any that switch to subscription only I'll just pass on by and read others.

I'm not sure I understand the Ad-based economy anyway. But then again, I'm involved in that part of the industry.

I think with the end / downhill track of print (as in the pulpy variety) and the reduction in advertising a lot of companies are looking for new options. I think WSJ and NYT are out of luck as I don't think their content is worth paying for. Ars, maybe (if information on what subscriptions gets you was made clearer, it removed the ads, and there was a way to pay without coming near the unspeakable evil that is Paypal (read: add Google Payments) - I haven't looked in a while so Ars might have this but since the subscribe page is down right now I can't check). I have a digital subscription to Linux Journal which is ok. Specialized news I can see paying for but not generalized. Not when it is out there in a ad-supported way. I think the market is just overfilled with generic news sources and that'll sort itself out shortly.

I think the idea of paying one subscription fee and getting to pick from a roster of news sites is a good idea. I read ARS a lot but I probably wouldn't pay a monthly subscription fee just to read ARS. Now if a subscription to ARS was lumped together with say 3 or 4 other sites that I like to read then we might have a deal, if the price is right. $50 a year or maybe $5-$6 a month is about what I'd be willing to pay.

Of course the big downside to subscription only content is that you can't easily share it with friends and co-workers. The value of the content is diminished a bit in my eyes if I can't share it with others.

Lastly, I would obviously expect a slightly higher caliber of news if I was paying for it. ARS strikes a decent balance of quality/quantity since all I have to put up with is a few banner ads but if I was paying for it I'd be more critical of the accuracy and length of articles.

There is a legitimate use for real news organizations. A blogger is not going to be paid to go into a warzone or go out in the world and do real reporting. Real journalists are still needed, its only the delivery mechanism (newspapers) that are obsolete.

I would probably be willing to pay a small fee for quality news. I would probably need a free trial to convince me that it was something I would be willing to pay for.

Originally posted by ChrisH:I haven't subscribed to the local paper in over 15 years.

I pay to get the Sunday paper delivered for one reason, the coupons! Maybe I'm just more of a deal hunter than others but I gotta have my coupons. The sad part is that after I get my coupons I throw the rest of the paper away. I almost never see any "news" in the local paper that actually interests me.

It is getting more and more depressing to read the headline on Ars: (1) the RIAA/MPAA organizations are winning all their battles as most nations seem poised to enact ridiculously draconian "NO INTERNETS FOR YOU!" laws aimed at banning anyone who has ever shared media from using the net again, (2) those providing news online will soon face similar attacks from big-time news wire services as the drive to make more money ratchets up, (3) ISPs are capping their service at dial-up speeds and enacting data limits like Time Warner's massive 1GB per month and finally (4) nations worldwide are rapidly ramping up efforts to lockdown, censor ("sanitize"), monitor and log every single data transfer.

I think "net neutrality" is officially dead, Jim.

This is how the internet as we know it dies, not with a bang, but with government hypersurveillance, ludicrous overregulation and monopolistic corporate ownership of every bit of content out there.

What a joke. 10 cents per article? ROFL. I don't go to places like NYT, Times, WSJ, WaPo, or any of the other mainstream news sites unless I'm linked or looking for something in particular as it is. Do they really expect people to pay for their talking-point editorials, manipulated statistics, and half-assed "embedded" reporting?

I hear talk about providing these papers with government bailouts, because the local paper is "a way of life" for so many Americans. As the pundits on various news channels like to repeat "People would be lost without their morning paper...they just want something they can hold." Bah, am I supposed to buy into these people's agenda? Of course they'll tell you that papers "need" a bailout.

If there are enough people that REALLY want dead-tree news, then how about jacking up the price to be profitable, instead of relying wholly on ads? Then perhaps they can even remove some of the filler and do real reporting, instead of doing the copy-paste job from Reuters and AP.

If I want real analysis and investigative reporting, I go to specialized blogs written by people directly involved in the industry. The quality of journalism does not get much better than Zero Hedge, Naked Capitalism, Mish, and Calculated Risk for economics and business information, for example.

Prior to the newspapers big push onto the net, I was able to find plenty of information sources that did not charge for content. In reality, the fact that there was news published on the net caused papers to build their sites. They were feeling the heat from the competition.

I stopped buying the local paper 2+ years ago. They jacked the price up once too often and eventually failed the cost / benefit analysis. I will venture a guess and say that they will do the same with their electronic services too.

I'd pay for access to my local news sites online. I don't know about $55/yr when compared to the $1/week ads I see for my local newspapers that actually deliver a hard copy to read every morning. I'd definitely pay for Ars.

Whats more interesting to me is how this would affect news aggregations sites, from Google news to sites like digg and (to a lesser extent Ars) who might otherwise link to relevant content behind a paywall. You guys have that issue now with the science and law blogs (PACER, etc), and I think it sucks that I cant read the source information you're writing about (its not your fault of course).

Originally posted by Netcraazzy:I pay to get the Sunday paper delivered for one reason, the coupons! Maybe I'm just more of a deal hunter than others but I gotta have my coupons.

Well, ya know, most stores put those up on their websites. And sites like retailmenot tend to archive lots of the coupon codes to online sites.

Not that I want to get you down if you enjoy clipping. To each their own.

This is partially true but not always, Grocery coupons are the main thing I get out of the paper. You can go to manufacturer websites and get some of these but I've found its best to clip the newspaper ones and then supplement those with stuff you find online. www.hotcouponworld.com and www.bensbargains.com are two sites I go to a lot. Unfortunately B&M retail stores are real sticklers about online coupons and some will not even accept them.

I would definitely pay for the NYT online, perhaps a daily PDF delivered over RSS in an <include>, with full access to the site for up-to-the minute news. For me, having free access to content after a certain period is VERY important, (as the works *must* become open to future criticism, and remain available for their long-term cultural import,) but having to pay for timely journalism from a reputable is something I'm absolutely willing to do.

On another topic, I, like another mentioned above, would also pay for an ad-free ars, but I won't subscribe until the benefits are substantial enough to make me do it. Paying to subscribe, and then having you monetize my individual page views seems like double dipping. Sorry guys, maybe tomorrow, but for now I'll keep my money.

Originally posted by PredatorGSR:There is a legitimate use for real news organizations. A blogger is not going to be paid to go into a warzone or go out in the world and do real reporting. Real journalists are still needed, its only the delivery mechanism (newspapers) that are obsolete.

No, there will already be people in the war zone that will be reporting it- the people who live there and are affected. And they may not have gone to journalism school, but they are capable of delivering a "real" report.

In these days, anyone with a computer (or even cell phone) is a journalist. Most of the time I'd prefer reading a blog from someone who is passionate about an issue, rather than an article from some paid "news organization" that only blindly repeats party line without checking facts.

When news sites start posting actual news, instead of just re-prints of AP, blog posts or updates on hollywood celebs, then it might be worth while.

* When I find more information on independant blogs, then it's not worth paying for news sites.

* When I hear about things months in advance from independant sites before I hear about it in the news, then it's not worth paying news sites.

* When news sites post "articles" like "Top 10 ways to save money during down economy" which are just a re-hash of the same old crap you've all already seen and heard from other places (except the other places did it better and had better opinions), then it's not worth ...

For this to work, you'd need to totally remove a consumer's ability to access news through any other news outlet.

If they don't have the ability to do this (and they don't), people will just flock to an alternate source of the same story. Or just listen on the radio, or watch on TV, or read through someone's twitter feed, or see on their own person website... etc etc etc.

There are few stories that are so compelling and are also exclusives to the media outlet that would make me want to pay. Off the top of my head, I can't think of any...

I am not willing to pay for someone's opinion. I am willing to pay for research and unbiased presentation of the discovered facts. Needless to say I do not subscribe to any newspapers, or WSJ.com since they were bought by Fox.

It is not hard to imagine a newspaper like the NY Times succeeding with a subscription model. But I think there will always be free advertising supported sources as well. Its conceivable that I might pay. But it certainly will not be for the Times. I rarely bother with it for free. I don't miss the Economist or the Wall Street Journal either.

Quote:"In these days, anyone with a computer (or even cell phone) is a journalist. Most of the time I'd prefer reading a blog from someone who is passionate about an issue, rather than an article from some paid "news organization" that only blindly repeats party line without checking facts."

You have got to be kidding me!!!!! Having worked in TV for quite a while, I can certainly tell you that while most entertainment professionals are lost and clueless, everything you actually watch is generated by a very small group of competent people. The same applies for Journalism. Bag in the NYT as much as you like, but those guys break real stories (AT&T wiretapping, no uranium in Niger, etc) far more then bloggers. An personally, I don't want passionate, partisan, totally biased bloggers as my only sources of news. That informs no one, and only re-enforces biases people already have.

The real issue here is about LOCAL news. This is where the package thing works. If I get the LA Times, the NYT, etc all in one pacage, then it's a good deal. National News comes from so many outlets it's hard to justify paying, but, if you want someone to go to al of your towns city council and school board meetings, you best be ready to pay them, because bloggers dont do that either...

everything you actually watch is generated by a very small group of competent people.

Which is nothing because there isn't anything worth watching and hasn't been in years. I'm all for broadcasters forced off the airwaves to free up that quality spectrum for something useful. I'd also like a pony.

And personally, I don't want clueless, partisan, totally willing to say anything for cash "professionals" as my only sources of news. They inform no one and only feed on biases people already have in order to maximize their paycheck.

It all depends on the quality of the content that determines if it's worth paying for. I'm not sure I want to pay for every newspaper article I come across. The heavy hitters like NYTimes and Washington Post have good national and world content, but if these are the only few that can convince people that they're worth paying for, you could see the fall of a lot of local papers. I admit I don't read much on local news, but I'm sure for many people it's important that it's there.

I find the reference to the Economist neat, as I've been a subscriber for years and never regretted it for an instant. Totally worth paying for.

I'm in favor of some kind of compensation system. I think journalism has been kicked to the curb since everyone expects everything for free, and that is hardly working for them. It does feel a bit like newspapers, and news organizations in general, are being pushed to accept a business model that is similar to late 90's startup companies. I think they deserve a lot of the blame here, but clearly their content and work is not being respected the way it should be.

I also completely disagree with the role of the journalist going away in favor of people on the scene. Sure there is some bias in every channel of reporting, but a regular citizen is hardly capable of reporting instead of someone who is trained to do so. Consider some of the biggest stories in the past (Nixon, wars, etc), where a lot of investigation was required to get to the bottom of a story. No ordinary citizen has the time or resources to take on something like this. Think of stories like Climate Change, and the like, imagine how confused the issue could become (as if it isn't already) if we had to rely on Joe Public to give us the details. Look up Aspartame on the internet and tell me how quickly you would be confused if you couldn't rely on professional sources (as it is there are many sites that are dedicated to telling the public that it exists for no other reason that to cause cancer). The internet is an amazing technology, and one that I've dedicated my life to as a developer, but it can misinform as quickly as inform, which is why is we still need paid, credible, professionals to dig up the dirt. As it is the internet does not offer a viable business model for this to happen.

I really can't believe all the people defending blogs. There is no journalistic integrity; the number of "rumour" articles is maddening. Honestly, bloggers are not journalists. If the NYT covered the same issues that Ars does, there is no way I would ever read Ars. There's just no comparison in the quality of writing and research.

I think that one of the big problems that newspapers are going through is what people expect from news. If you look at a lot of blogs and cable news, it's very clear that people don't want to know the truth; they want their world-view re-enforced. Media that has integrity cannot serve these people. Seriously, consider this question: If I want to know the effects of NAFTA on US GDP growth over the last 5 years and how it has affected voting patterns in the southern US, what information sources do you consult? From my ranking above, no competent person would every suggest looking at the last three. You would never get a complete, balanced examination of the topic. Maybe you find a couple of paragraphs online; that doesn't have any value when examining a complicated topic like this.

It takes really well-educated people to produce quality information. The "mob" of the Internet cannot do that. If there is some news on the internet that is completely new and is only covered in blogs, try to follow it. Look up the sources, try to validate the information. Yeah, there are many instances where the information is good, but a lot of the time, the sources start taking you in circles. There's no information to be had; just slight exaggerations over time that lead to sensationalist and untrue stories. Think about the constant BS we hear about Apple; it's always rumours galore, but there's very little more than that.

I don't want to preach too much from an ivory tower, but come on. If I want to learn about, let's say, economics, I'm going to turn to someone like Paul Krugman (Nobel Prize in Economics) at the NYT or another educated, disciplined author rather than the sum of all economics bloggers in the world.

I meant to add: If magazines want to look to the Economist as a reason to increase prices, they need to take some notes as to why so many people are willing to pay for it. True, their market is a higher income bracket, but they need to look at the content. It's not recycled AP stories. There's insight and analysis there that you won't find anywhere else, facts researched that no one else thought to look. (I swear I read so many inconsistancies with this recient pirate fiasco that I swear I wouldn't be surprised if someone reported that Navy ships were shooting lasers at swashbucklers riding on sharks.)

It's not about blogging. If newspapers can make money, and by money I mean "any money at all" with the current paradigm, it will succeed. It does not require me to sign up for anything, nor does it require me to pay for anything. If the NYT and other major newspapers withdraw from this method of delivery, they will fade into the annals of history.

This site itself (ars) is proof positive that this method can work; and the news produced by it can be insightful and well researched (read the Law and Disorder articles if you think otherwise.)

It's not even the money; it's the "signing up for an account" thing. I bet if you kept Ars free, but required a user to log in before reading articles, readership would drop by 60% or more. And Ars' stories are not available from any random AP affiliate site.

Originally posted by jbrown96:I don't want to preach too much from an ivory tower, but come on. If I want to learn about, let's say, economics, I'm going to turn to someone like Paul Krugman (Nobel Prize in Economics) at the NYT or another educated, disciplined author rather than the sum of all economics bloggers in the world.

Well eventually something will give. People will not work for free and if ads do not support news sites in the future, either the news will disappear with the exception of NPR,PBS or some kind of fee will have to be charged.

No such thing as a free lunch. Eventually something will have to pay the bills or shop will close and bloggers do not count as news since they just regurgitate reports from the AP,etc..

@jus10 - "And personally, I don't want clueless, partisan, totally willing to say anything for cash "professionals" as my only sources of news. They inform no one and only feed on biases people already have in order to maximize their paycheck."

That is totally disingenuous! Maintaining a blog, in addition to his column, both on NYTimes, doesn't make him a 'blogger' as opposed to a journalist! He gets paid by NYtimes to write, and research. The fact that not all of his writings appear in the paper version of the NYTimes does not make hm not a journalist. The same guys for all the guys @ wired, etc.

I'm one of those guys who pays for the Economist but not willing to pay for general news. As its been mentioned by several previous posters, the Economist provides much more value added than just the news. Even the news isn't dumbed down to a junior high school level.

The WSJ, NYT and the Washington post are the only ones for which I'd even remotely considering paying and at the moment, their value in my eyes is dropping. It's the same old recycled crap. Their national headlines are the same as everyone else's. Why would I pay for the same content that is provided free by the BBC or <gasp> CNN?

Because I rarely am in one city for long, I'm not really interested in local news, but for those times that I am, I notice that the local TV stations' websites have the same info. Yes, TV journalism is the "special" little brother of print journalism, but at its core, it's the same info. The TV stations aren't going to make you pay, because they don't run on a subscription model. Arguments about sponsor ownership of the news aside,

This concept of paying for general news is a dead model. The old media need to realize this and adapt, not continue banging their heads against the wall trying to squeeze blood from a paradigm that the rest of the wired world has moved past.

Unfortunately, this group of media moguls who are running the show and are trying to push this model on us simply don't get it. The kicker is that they never will. I've resigned myself to just waiting until these guys retire or die.

Paul Krugman may be a blogger, but he didn't get his expertise by blogging. He had a series of well paying jobs and a ton of education.

Exactly!

So whether you're a blogger or a pro is irrelevant. It's what you know and relative credibility. I don't care about how much money Krugman's made, or what papers hang on his wall. He has a clear concise way of explaining economics in ways which make sense.

@chaoswarriorx

I know. I'm just pointing out he's also a blogger. You can be both a blogger and a journalist. Although I don't think of Paul as a journalist; I think of him as an economist. I like him.

Originally posted by Netcraazzy:I think the idea of paying one subscription fee and getting to pick from a roster of news sites is a good idea. I read ARS a lot but I probably wouldn't pay a monthly subscription fee just to read ARS. Now if a subscription to ARS was lumped together with say 3 or 4 other sites that I like to read then we might have a deal, if the price is right. $50 a year or maybe $5-$6 a month is about what I'd be willing to pay.

Of course the big downside to subscription only content is that you can't easily share it with friends and co-workers. The value of the content is diminished a bit in my eyes if I can't share it with others.

Lastly, I would obviously expect a slightly higher caliber of news if I was paying for it. ARS strikes a decent balance of quality/quantity since all I have to put up with is a few banner ads but if I was paying for it I'd be more critical of the accuracy and length of articles.

All great points and I second all of them! I'll pay a yearly fee to access a group of sites I choose. As long as it's affordable and worth the money! I'll be damned if I pay per article or pay just to view one site. Forget that bullshit.

What a lot of folks miss is that the reason a lot of news get disseminated online is that these aggregators (digg, et al) get news from "traditional" outlets, as well as drivel that gets made up (boy genius, et al) and they simply package it up and hit publish, and folks say dum shit like yeah, i get all my news from Digg. Meanwhile these aggregators make ton of money and literally dont do $hit.

Lets be real, the only reason the net took off was because of traditional media. Half the people in the country on twitter, FB, eBay, Expedia, et al wouldnt know about any of them if it werent for ads via traditional media outlets (TV, Radio, print). Yes Virginia, they still have value. So dont go believing all this internet only hooey.

If you want a cop, you dont get the dude down the street that goes to the gun range or in the woods with grand pappys rifle, you get a trained, educated, certified cop to address ,your business. If youre getting surgery, you dont go the 7 yearold that just dissected a rat in science class, you get a surgeon. And in that same vein, i want my news from people that know wtf they are talking about, we dont call them pundits, we them journalists. they actually do work.